Indonesia's emerging energy-efficiency market

Indonesia is the fourth most populous country in the world. Its growing economy has the potential to develop into a robust market for energy-efficient technologies. Demand for electricity is growing at 15 to 17 percent annually, requiring over $5 billion per year in new capacity investments through 2005. The increasing openness of the economy, removal of energy subsidies and greater participation in the international economy are driving interest in energy efficiency. Growing markets for motors, air conditioning equipment, commercial building systems, household appliances and industrial process equipment all signal opportunities for increased energy efficiency. An energy-efficiency policy framework is emerging, but several important barriers to improved energy efficiency remain. For example, high-efficiency equipment is more expensive to purchase than standard equipment, and it is often difficult to find financing for energy-efficiency improvements. Also, some types of high-efficiency equipment are not readily available in the local market. Equipment standards, energy-management training and voluntary energy-efficiency programs for private sector firms are recommended to help address these barriers.